Ex-lawmakers: Hike gas tax 47 cents to fix Michigan roads

Jonathan Oosting
The Detroit News
Former Michigan state Sen. Ken Sikkema, a Republican, is one of two leaders of a new bipartisan group proposing a gas tax increase to pump an extra $2.7 billion a year into road and bridge repairs.

Lansing — A new bipartisan group co-chaired by former state Sens. Ken Sikkema and Bob Emerson is calling for a 47-cents-per-gallon gas tax increase over the next nine years to pump an extra $2.7 billion a year into Michigan's roads and bridges.

The proposal released Thursday by the “Michigan Consensus Policy Project” comes as Democratic Gov. Gretchen Whitmer prepares to unveil her plan to “fix the damn roads” in March as part of her first budget presentation.

“There’s no question there’s a need, and no question about the importance of this,” said Sikkema, a West Michigan Republican and former Senate majority leader. “It’s our hope that this proposal jump starts that important conversation.”

The proposal calls for a five-cent increase in per-gallon gasoline and diesel taxes in each of the next nine years, which would eventually generate the $2.6 billion in needed funds identified last year by former Gov. Rick Snyder’s 21st Century Infrastructure Commission.

An additional two-cent tax would be applied in the first year to generate $110 million annually that state and local units could access with matching funds to finance additional local projects.

The proposal promises to be a tough sell in the Republican-led state Legislature, which grudgingly approved a seven-cent gas tax increase as part of a $1.2 billion-a-year road funding law that Snyder signed in 2015. The state isn't set to generate the full $1.2 billion until 2021. 

“The problem hasn’t been solved, and it needs to be solved,” Sikkema said, noting projections that it is significant more expensive to rebuild a bad road than it is to maintain a decent one.

A 47-cent increase would give Michigan gasoline tax of 73.3 cents per gallon, which would be the highest rate in the nation when fully implemented in nine years. The proposed rate would be a nearly 180 percent increase over the current tax of 26.3 cents per gallon.

Raising the gas tax is the most appropriate way to raise new revenue for roads because it “closely correlates to he amount of driving people do,” said Emerson, a Flint Democrat.

The proposal would cost the average middle-income, four-person household with two vehicles about $67.41 in additional gas taxes the first year and another $48.15 in each of the next nine years, according to an outline. When combined, the average household would be paying more than $400 a year extra in gas taxes under the plan. 

Paul Hillegonds

Whitmer has not finalized her road funding plan, but on the campaign trail she hinted at possibly raising user fees or asking voters to approve long-term borrowing in the form of state bonds.

Bonding is “one of your less desirable options, because it ends up costing you more when you borrow the money and you have to pay it back with interest,” Emerson said.

“You’ll get a lot of work done up front, but you’re stealing from the future to pay for the work that’s going to be done today.”

The bipartisan group that developed the proposal includes former Lt. Gov. John Cherry, a Democrat, and former state House Speaker Paul Hillegonds, a Republican. Other former officials are expected to join the group as they propose additional “consensus” solutions in the future.